MOSCOW, Dec 4 Russia's Uralkali will
cut potash output by half to 2 million tonnes in the December to
March period to reduce excess global supply during a protracted
fall in demand, its chief executive said in an interview.

China and India halted contract purchases of the crop
nutrient in the second half of the year and are expected to
contract lower volumes next year, making for a slow start to
2013.

China is seen as being well supplied, while a reduction in
Indian subsidies and a weaker rupee have made potash more
expensive the nation's farmers.

"Starting from December and during the first quarter we will
work with 50 percent of capacity, because demand will be rather
weak," CEO Vladislav Baumgertner told Reuters. "We also expect
that this will help decrease stocks."

Uralkali, the world's largest potash miner by output and the
second-biggest potash producer by capacity behind Canada's
Potash Corp of Saskatchewan Inc, expects to sell about
1.6 million tonnes of potash in the first quarter of 2013.

Full-year 2012 sales are seen at 9.3 million tonnes, said
Baumgertner. He did not provide production guidance, saying only
the company's annual capacity will be at 13 million tonnes by
the end of this year.

The BPC trading company, a joint venture of Uralkali and
Belaruskali, may sign contracts with India in December and China
in March, while prices should remain stable, Baumgertner added.

Uralkali expects global demand for potash to rise to 54
million tonnes in 2013 from 48-49 million tonnes in 2012, he
said.

"Stocks will be consumed by the market during the first
quarter, and producers will be able to sign contracts with China
in March," Baumgertner said.

"Stocks in India are not too high and stay on usual levels -
of about 1 million tonnes. The Indian contract can be signed
already in December," he added.

Prices for China and India in the new contracts should
remain stable, the CEO said. The BPC trading company, which
Uralkali operates together with Belaruskali, will look to
maintain prices close to current levels - $470 per tonne and
$490 per tonne respectively, he added.